The new Senate Bill, SB 67, was designed to protect newly-licenses cannabis farmers while they work to come into compliance with state laws. According to the California Department of Food and Agriculture, there are more than 10,000 temporary state cannabis licenses in the state system that will be expiring between now and of July 2019. SB 67 was approved in its first Senate committee last week with an 8 to 0 vote in the Senate Business and Professions Committee.
Co-author Assemblymember Jim Wood said, “We have many folks in the cannabis industry who have worked hard to comply with new rules and requirements, and we have, from the start, experienced some growing pains as state and local governments have also worked hard to get their processes running smoothly. This bill will provide some short-term relief to those who have submitted their annual license applications on time and allow the various state agencies to catch up with the volume of applications that have been submitted.”
Under current law, the state has no ability to extend a temporary license. Thousands of applicants applied for temporary licenses in the last quarter of 2018, which caused a massive backlog for state regulating agencies. This massive volume of temporary licenses creates the real risk that not all provisional annual license applications can be processed prior to temporary licenses expiring. As the temporary licenses come due, if the state can’t approve or deny an annual license prior to the temporary license expiring, the license holder, whether it be the grower, farm, distributor or retailer, will no longer be operating legally.
“Bottom line is this: This bill will protect thousands of cannabis farmers, in particular, who did the right thing and applied for and secured a state license. But because their temporary license is about to expire, and because of the inability to extend their license due to existing state law, they could be forced into the black market. Obviously, this can’t stand which is why we’re moving quickly to keep a legal, regulated market here in California from collapsing,” Senator Mike McGuire said.
Proponents say this is not the way to transition a multi-billion dollar agricultural market that employs tens of thousands of Californians. Without legal licenses, there isn’t a legal, regulated market in California. “We can’t afford to let good actors who want to comply with state law fall out of our regulated market just because timelines are too short and departments have been unable to process applications. Without legal licenses, there isn’t a legal, regulated market here in the Golden State,” McGuire said.
Supporters say SB 67 allow the state to extend temporary licenses held by licensees while their annual application is being processed, so long as the annual application was submitted before the temporary license expired. “SB 67 will also improve the provisional annual license process in the state. It allows licensing authorities to do all in their power to convert temporary licenses to provisional annuals. SB 67 allows licensing authorities to grant provisional annuals to those without temporary licenses once the backlog of applications for those with temporary licenses is resolved. It also extends provisional licenses to July 1, 2020.”
